Nvidia was propelled into becoming a titan of the hardware industry by the frenzy in the AI market. However, an unstable market driven by a speculative bubble is not a sound foundation. We can get an idea of what Nvidia can expect going forward by looking at what happened with Cisco during the dot-com bubble.

Cisco thrived as the backbone of the internet revolution, supplying networking equipment to a wave of startups and tech companies. But when the bubble burst, the contradictions of capitalism came crashing down. Overproduction led to a glut of hardware, bankrupt startups flooded the market with second-hand equipment, and demand for new hardware evaporated. Cisco quickly went from being a star to a company facing serious financial troubles.

Nvidia finds itself in a rather similar position today. The AI boom created a massive demand for GPUs, with VC funded companies investing billions into hardware. All of a sudden, DeepSeek disrupted both the need for Nvidia’s hardware the whole AI as a service business model. When the bubble bursts, the market will be flooded with second-hand GPUs, driving down demand and undermining Nvidia’s core business.

This is the essence of capitalist contradiction: the system’s drive for endless expansion leads to overproduction, while its reliance on speculative markets ensures that demand is inherently unstable. Both Nvidia’s dependence on high-risk AI startups and Cisco’s reliance on dot-com companies illustrate how pursuit of profit creates fragile ecosystems that are vulnerable to sudden collapses.

The broader implications for the industry are equally damning. Companies that have invested heavily in expensive GPUs may pivot to new paradigms, leaving Nvidia with reduced relevance in a transformed market. Nvidia’s current valuation, inflated by AI hype, could face a sharp correction as growth slows and the second-hand market undercuts new sales. Other players in the AI hardware ecosystem, dependent on Nvidia’s dominance, could also face fallout, further destabilizing the industry.

This scenario isn’t an isolated case of one company’s potential decline, it’s a microcosm of capitalism’s inherent flaws. The system’s reliance on speculative booms, its tendency toward overproduction, and its inability to plan for long-term stability ensure that crises become inevitabilities. Nvidia’s trajectory, like Cisco’s before it, is a product of a system that prioritizes profit over sustainability, and short-term gains over collective well-being.

The cycles of overproduction and collapse will continue as long as the pursuit of profit remains the driving force of economic activity. The only way to break free is by building a new system based on rational planning, collective ownership, and the prioritization of human needs. Until then, the crashes will keep coming, and the working class will continue to pay the price.

  • الأرض ستبقى عربية
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    9 months ago

    I really hope nVidia collapses or at least suffers major losses. It is one of the companies that invest in the ethnic cleansing and occupation of Palestine

  • FuckBigTech347
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    9 months ago

    I had very similar thoughts for a while but you put it better into words than I ever could! It will be hilarious to see NVidia crashing down. The techbros tears who bought into their marketing bullshit will be sweet lol.

    • ☆ Yσɠƚԋσʂ ☆OP
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      9 months ago

      I really can’t wait for the whole tech bubble to crash. It’s been so frustrating to watch this nonsense.

  • loathsome dongeaterMA
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    9 months ago

    I was not sentient when dot com bubble happened but surely it could not have been as silly as the AI hype right?

  • NothingButBits
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    9 months ago

    I don’t think the stocks will colapse soon. There are still several billion dollar AI infrastructure investments to happen in the US. I think demand will continue very high for NVIDIA. In fact, I think this is instead a case of market monopoly. NVIDIA now has free reign to do what they want, so the profits will continue for a long time. Also, there the issue of the US printing more money each year, which just inflates all stocks.

    • ☆ Yσɠƚԋσʂ ☆OP
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      9 months ago

      The gig might keep running for a little while still, but eventually it’s gonna have to come to an end. Nobody is going to be paying subscription fees to OpenAI if they can either run DeepSeek themselves or pay for a subscription at a fraction of the cost. And the ideas from it will be quickly incorporated into western models as well, so even the problem of this being a Chinese company will go away soon.